A blog on issues affecting Australia's newsagents, media and small business generally. More ...

VANA unsuccessful on home delivery fees

Further to our Bulletin dated 13 November 2008 re Home Delivery Fees. VANA has been discussing a Home Delivery fee increase with HWT for quite some time and we are extremely disappointed to advise that Peter Blunden, Managing Director of HWT has informed us that we have not been granted an increase.  He has stated the following:

“After giving the matter careful consideration, we have decided to seek alternative ways of addressing the issues raised”.

With that, VANA has announced that it has failed, again, to deliver for its members. 

No wonder newsagents are quitting newspaper distribution. 

In what other business is a service provider expected to carry cost increases every year in labour, fuel and other areas, cope with a reduction in margin and survive with no increase in service to compensate? 

Newspaper publishers will wonder, at some point in the future, why newsagents abandoned what was the best newspaper distribution system in Australia.  The answer can be found in this decision and many similar decisions which preceded it – to not pay a fair day’s pay for a fair day’s work by newsagents. 

I know newspaper executives are concerned about the number of newsagents quitting home delivery.  They invite such action with decisions such as this.  Sadly, the VANA announcement contains no passion on behalf of newsagents. 

I wonder who VANA used to prepare and represent its case?  If this was done in-house or by VANA Board members then it has let its members down.  On a case such as this, professional representation is essential so that the newsagent position and negotiation is as strong as the other side.  Such a case would have included information on advertising rates as a comparison among other things.

Home delivery is a service by newsagents.  It is only reasonable that they set the fee they cahrge for the service they provide.

0 likes
Newsagency challenges

Small retailers ‘protected’ on unit price

The Federal Government yesterday announced that small retailers, those with stores under 1,000 square metres, will be exempt from mandatory unit pricing.  This will be of interest to newsagents selling grocery products, those covered by the regulations.

While this looks like a victory for small business, it, in my view, widens the gulf between them and big retailers. 

Unit pricing is not that difficult since the work is done by the software and the data included on shelf talkers and other labels produced.  I certainly plan on using unit pricing and eliminating an opportunity for a customer to prefer a bigger competitor over one of my businesses.

The Australian has more on the Government’s announcement.

0 likes
Competition

Banksia Beach News promotes fellow newsagents

30122008.jpgCheck out how Peter Williams at Banksia Beach News in Queensland has embraced the newsagency marketing campaign we developed a couple of months ago.  On several window panels of Peter’s shop he has included artwork which connects with the TV and print campaign.  Peter has done this at his own cost to connect his business with the wider newsagent network and to support other newsagents. 

Thanks Peter!

0 likes
newsagency marketing

Newsagent charged $4,000 a year for software support

A newsagent called me last week to ask for help.  They received a bill for $4,000 for software support.  No, I didn’t tell them to switch to my software company, Tower Systems.  I advised them that I know of newsagents paying just $1,500 a year to their current software company for support (mediocre as it is). 

Software companies ought to treat all newsagents.  There is no justification to charge someone $4,000 and the newsagent in the next suburb $1,500 for the same services – such an approach preys on the weak.

Trust is key to the relationship between newsagents and their software provider.  Trust is demonstrated in common pricing for all.  In the case of this other software company, $1,500 a year software support is the benchmark they have established.

0 likes
Ethics

Diaries at full price

We have been talking across our newsagencies about our price policy for diaries and when to contemplate discounting the 2009 range.  With excellent sales still being achieved – $500 to $900 a day Friday last week and again today across our stores – we feel no need to contemplate discounting at this point. 

I was in a newsagency yesterday where their diaries are at 50% off.  They told me they did this because another store was discounting.  The newsagent has a bigger and better range.  This is why we don’t need to discount.  It demonstrates the value of a point of difference. 

0 likes
Diaries

Promoting the CSIRO diet and

fhn_ni_jan09.JPGThe free 12-page CSIRO health heart program diet book which comes with New Idea this week earns prime position at our counter. 

Thankfully, Pacific Magazines has not cut supply over summer as some other publishers have – we have plenty of stock to support the hoped-for sales kick as a result of the front counter promotion.

New idea is an easy impluse offer with the right cover or some other value-add.  Girlfriend, in this same position last week, did well for us.

0 likes
magazines

Managing magazine early returns

early_returns.JPGMagazine publishers and distributors hate early returns, the mechanism through which newsagents send titles back prior to their requested return date.  Newsagents hate them too.  For us, they are work based on an expectation of failure of the title.  For the publisher, they could be a denial of opportunity (and sales).  For the distributor, I am not so sure since they are paid a fee for logistics services regardless.

The label in the photo is produced by our software when we are supplied product which the software is certain we will not sell.  This is one of several mechanisms available to us for flagging early return opportunities based on what is to be supplied.  The label is good because it is a push activity.  That is, it is produced by the software along with pricing labels used in labeling magazines before they are put on the shelves in the morning.  This means that newsagency staff do not need to print out reports or undertake other work find out early returns opportunities.

Early return opportunities are only flagged when a title does not sell as well as a distributor expects.  That is remembered so that action can be taken next time it is supplied.  

Given that it is my money at risk with this dead stock, it is appropriate I take every step possible to mitigate any potential loss.  The frustration, of course, is that this problem is created by magazine distributors given that they have the data to stop supplying something which will not sell. 

Newsagents are stung because they have to fund sending early return product back – I found out recently that this is not the case in some overseas countries. 

One way we could address this, in instances of gross over supply, would be to top the covers and only send these back.  Publishers would soon get the message that gross oversupply is a serious problem.

0 likes
magazines

More happy space products

fassets.JPGThese small pads from For Arts Sake are an ideal addition to the happy space in newsagencies about which I blogged yesterday.  They work at the counter as an impulse item and also work in an area dedicated items which reflect a positive outlook on life.  Our customers love items like this.  They make for an ideal small gift to accompany a Thank You or Congratulations card.

The more I think about the more I like the idea of a section of our newsagencies, a happy space,  dedicated to positive and inspiring gifts and thoughts. 

0 likes
Happy products

Who needs a TV guide?

Check out TV.COM.  This online TV viewer resource has been localised.  Access is free.  Sites like this represent a considerable challenge to print TV listings such a TV Week and the inserts in daily newspapers.  They are another reason we need flexible magazine fixtures. 

0 likes
magazines

4 Ingredients 2 costs us too much

4ing.JPGMagazine distributor NDD sent us 18 copies of 4 Ingredients 2 cookbook on Christmas Eve.  There is no justification for this – especially since 4 Ingredients 2 is available from book retailers for between $15.00 and $17.95.  The newsagent price is set at $19.99.  Our margin is a magazine margin and not a book margin so we have no room to move on price.  NDD has abused us by sending this stock.  It has arrived too late to be a Christmas offer, the price makes us look expensive and too much stock has been sent.  

The behaviour by NDD in my own situation with 4 Ingredients 2 represents, in my view, unconscionable conduct as defined by the Trade Practices Act. 

We will send all copies of 4 Ingredients 2 back.  We may even rip off the covers and return just those since this is a gross oversupply.  We may even rip off the covers and return just those since this is a gross oversupply. By topping the book and returning just the cover we make a statement.  Newsagents have to stop NDD abusing us as has been done in this instance.

0 likes
magazine distribution

Box magazine and the grab for cash

boxmag.JPGWe received eight copies of Box magazine from NDD on New Year’s Eve at our Frankston newsagency.  Based on our assessment of what sells in this location, Box magazine is not for us.  We are early returning the stock.  It is a failure of the magazine supply model which allows this.  I am suspicious that it was supplied to us on the last day of the month given that the title had been out for some time.  That we are given no choice by NDD to carry an obscure title like Box is a problem for our channel and another reason, I suspect, why newsagents choose to not deal with NDD altogether.

0 likes
magazine distribution

Network Services MIA after spam

Many newsagents reported receiving between 20 and 100 emails from magazine distributor Network Services yeatersday about credits and supply going back several months.  I am not aware of any newsagent successfully making contact with someone at Network about this.  I tried several numbers, including people who can bypass the usual call centre queue, and got nowhere.

Magazine distributors need to understand tht newsagents work when other businesses take a summer break.  To not provide customer service this time of year when your software goes haywire is poor form from Network Services.  The cost in lost time is frustrating. 

The Tower Systems help desk took calls about this because Network was not responding.

0 likes
magazine distribution

A happy space in a newsagency

positive_prod.JPGThese postcards make customers happy – when they browse and when they purchase.  Their positive message is infectious to people open to feeling happy.  They are part of a range we have from Compendium.  In several of our stores are have a happy space where everything is about nurturing happiness.  We have not signed the space or made it obvious in any way other than through the placement of products.  The products are popular.  They are purchased on their own and as a small gift to go with a greeting card.  Besides the postcards, there are booklets, books, cards and trinkets.  Besides being happy with the sales, this part of the shop is good to visit as the products inspire as well as the customer who browse them.

0 likes
Customer Service

Amazing boxed card sales results

dsc05822.JPGI am thrilled with the strong sales for boxed Christmas cards eight days after Christmas in our post Christmas sale.  The best sale yesterday was one hundred and twenty five packs of a specific design of boxed cards to a single customer.  We pulled these in from three of our shops. 

In each of our centres we are the only outlets with a good range of boxed Christmas cards left.  Word of mouth is driving good traffic to us – we know because customers tell us.  In one case, where regular traffic is not so hot, the cards are finding new customers for us.  Our average daily sale of boxed Christmas cards in each location is in excess of $700.00. 

We sourced this boxed card product specifically for the sale.   Our margin is 60%. 

The boxed cards are the hero product.  Customers drawn into buy boxed cards also purchase calendars, magazines, lottery tickets and newspapers.  Not every time but enough to make us happy.  We know because we have watched these customers – not those in buying a magazine or a newspaper but those walking past who see the display, come in and browse, pick up several boxes and then browse the shop.

This is a great seasonal opportunity for newsagents – the planning for which starts in February.

0 likes
Greeting Cards

Promoting Girlfriend at the counter

fhn_girlfriend_jan09.JPGDespite receiving no marketing collateral, we are promoting the latest issue of Girlfriend magazine at the counter given the number of gifts which come with the latest issue.  The display has been up since Wednesday.  It is good to move away from Christmas at the counter. 

We are committed to continuing to use this counter space to promote titles with we consider to be an easy impulse purchase.

0 likes
magazines

Joe Hockey is wrong about newsagents

Newsagents and pharmacists are two forever-protected species as far as the coalition is concerned. 

This is a quote attributed to Joe Hockey, the former Minister for Small Business in the Howard Government.  It’s on Page 12 of the Perspective insert in the Australian Financial Review (Dec 30 – Jan 4).

Joe Hockey and his colleagues demonstrated their commitment to newsagents through their years in office by:

  1. Facilitating the elimination of exclusive newspaper and magazine distribution territories without compensation for taking away from newsagents this century-old right.
  2. Driving newsagents to enter into new contracts with publishers and permitting this to be done by newsagents negotiating on their own behalf and not using professional negotiators.
  3. Allowing poor leadership of newsagents at the time to wipe off more than $100 million dollars of value of newsagent businesses without compensation.
  4. Permitting a contract relationship for newspapers and magazines which deregulated one side of the transaction and left newsagents with an expensive and inefficient system which was designed for a regulated marketplace.
  5. Permitting the 865 Government owned Australia Post retail outlets to become more and more like newsagents, moving into areas traditionally serviced well by newsagents.
  6. Refusing to intervene in 2004 when Australia Post was engaged in what I’d consider grossly unconscionable practices when newsagents tried to establish an alternative bill payment network.
  7. Refusing to respond to newsagent representations in 2004 about an unfair magazine distribution system which operates at a loss for many newsagents.

Joe Hockey is wrong about newsagents.  The Coalition has not demonstrated any concern for newsagents other than hollow words.

That said, we owe our poor handling of deregulation to the two or three newsagents who ran this project on behalf of newsagents.  They were not up to the task.  The cost of their failure will be felt for years to come.

Footnote: This blog post is not a call for regulation.  We needed to move away from the protection of what we had until 1999.  However, what we do need is complete deregulation – fair commercial terms around the distribution of newspapers and magazines. 

0 likes
magazine distribution

Kansas newspaper to stop print edition

The Kansas City Kansan, the only newspaper exclusively devoted to covering Kansas City and Wyandotte County in the US will cease publishing a print edition from January 10, moving to a pure online model.  Read their announcement here. 

While this is a small town story from the US, the drivers of the decision by the publisher exist worldwide.  Smart newsagents are prepared.  They are doing this by balancing their business, not relying on one category as much as before and modifying their shop fit to facilitate change.

0 likes
Media disruption

Assaulted by a customer

Jason, the Manager of our newsXpress Forest Hill store was bitten by a customer yesterday.  The customer was trying to retrieve two credit cards he handed over for a transaction.  Jason suspected, based on a call from our bank’s fraud department on Monday, that one of the cards was stolen.  The customer became agitated and got behind the counter while Jason was on the phone to be bank.  In the ensuing altercation, the customer bit Jason and escaped.  The Police came can and gathered evidence of the assault.

This all started with a transaction on December 26 for which a customer used a stolen credit card to transfer money to a prepaid card.  Since it went through the bank we did not know of a problem at the time.  One the same day a similar transaction using the same card was done at our Frankston newsagency.  The bank called us Monday and from then we were on alert. 

Yesterday, when an identical transaction was presented at Forest Hill, Jason stepped in.  His role as Manager of the business does not require him to be physically attacked by customers like this.  The Doctor treated the wound and gave Jason  a tetanus shot, it will be three months before he knows if the bite introduced any infection.

We have tightened prepaid Visa card loading transactions and now will only take money from another card if the customer has the PIN number.  While the bank does not require this we feel it is an appropriate precaution.

0 likes
Customer Service

Scooters and food

scooter_food.JPGWhat do scooters and food have in common?  Lots accouding to News Magazines, the publisher of Two Wheels Scooter magazine.  The latest issue which came in today is bagged with Super Food Ideas – although, you have to turn the bag on the side to see what the free title is.   

Scooter is one of those titles which needs to be browsed to sell – the bag stops that.

0 likes
magazines

7-Eleven aggressively pitches Tattersalls products

tatts711.JPGFrom the front window to the sales counter, there is no missing the promotion of Tattersalls products at 7-eleven stores in Victoria.  The pitch is aggressive, multi-faceted and co-branded.  It demonstrates the importance 7-Eleven and Tattersalls place on their new relationship.

At the front of 7-Eleven stores are generic as well as game based window posters.  In store, there are promotional flyers above the counter and a counter mat pitching the various ticket offers for each game.  All co-branded Tattersalls and 7-Eleven.

You cannot shop in a 7-Eleven store and miss the Tattersalls pitch – even where there is a full-service Tattersalls outlet next door. 

When Tattersalls told us they were making this move they said it would not impact existing outlets because 7-Eleven stores attract a different market.  7-Eleven is using the arrival of Tattersalls product to lure new customers, newsagency customers.  Newsagents next to 7-Eleven outlets would often remain open late on a Saturday to service Tattersalls customers.  If the 7-Eleven pitch works they will lose customers and money and probably end up closing earlier.

Tattersalls co-branding with 7-Eleven rubs salt into the wound of existing outlets given that Tattersalls refused to permit co-branding with newsagent marketing groups in the past.

While I am all for competition, it must be fair.  The relationship Tattersalls has agreed with 7-Eleven is unfair to newsagents and other existing Tattersalls outlets.  From what I saw yesterday, it provides 7-Eleven with an unfair competitive advantage.  It does this while Tattersalls continues to hold us back and shackle us with loss generating overheads such as the scratch ticket bays. 

We are threatened with losing Tattersalls products if we put non Tattersalls products in these scratch ticket bays.  This prime counter space sits idle, losing revenue while Tattersalls bends the rules for 7-Eleven.  Tattersalls some months ago represented that they expected to win the right to sell instant scratch tickets again and that this is why the scratch ticket bay real estate ought to be preserved.  They did not win yet the prime real-estate sits idle, not earning what it could for us.  And in the meantime Tattersalls is energetically developing a new retail network.

Of course, through all of this, the Victorian Government remains silent.  They created this problem and have refused to accept any responsibility for the cost of their poor policy decision to hundreds of Victorian family businesses.  They will say they have asked Tattersalls to treat their retailers fairly in terms of the scratch ticket bays but have not gone beyond asking.

0 likes
Lotteries

November a tough month for cards

Our November newsagent sales benchmark Study shows that conditions are tough for newsagents.  Greeting card unit sales fell, on average, 9%.  It also shows that some newsagents are doing well in this environment.  Rather than focus on reporting falling sales for cards, magazines and newspapers, the report highlights growth opportunities.  The keys appear to be that newsagents assert more control over their business and embrace change.  The benchmark data set shows newsagents having success in doing these things.

0 likes
Newsagency challenges

Strong diary sales

diaries_2009.JPGWe are seeing excellent diary sales this year compared to last, from the beginning of the diary season, almost two months ago, we have been ahead in sales on last year.  We have kept promotion of diaries on the move, most recently promoting the category in the window which was home to our Christmas display. While this year’s success builds on previous years of growth, the numbers we are seeing already make it a stand-out.  This has a lot to do with good in-store management of the range, display and customer service. 

Diaries are a category in which newsagents can excel as they permit us to demonstrate our commitment to customer service compared to Officeworks, Big W and others playing in this space.  They muck it up by offering house brands and poor customer service.  House brands don;t work in the diary space – not for the majority of customers. 

People who rely on getting the right diary are more likely to be let down by these bigger competitors.

0 likes
Diaries

Yellow Pages earns more from print

Sensis has reported that Yellow Pages’ print revenue was up 5.3% in the financail year to June 30 2008.  The Australian yesterday had a good story which compares this to declines in print directories elsewhere in the world.  It is appropriate I mention Sensis’ success given othere posts I publish on the shift from print to online.

0 likes
Media disruption
Trending Articles

Fairfax changes approach to TV Guide, disrespects newsagents

Published on April 20, 2011

What do you think of the Powerball changes?

Published on February 16, 2018

IPS releases new magazine contracts

Published on June 21, 2011